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Ecommerce Glossary Of Terms & Jargon Buster

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Glossary, Ecommerce FAQs

Glossary of ecommerce terms.jpg

A

Affiliate

A "system that pays a percentage of the sales revenue from an online computer purchase to the website that suggested the purchase." An individual (or business) who promotes your product or service for a 'commission'. This differs from a sponsorship program in that payment is dependent on an actual sale taking place during the referred visit.

Amazon Marketplace

"Amazon charge fees on every sale through the Marketplace, and also offer Fulfilment By Amazon, where they handle the fulfilment process for your business at extra cost."

Average Order Value (AOV) 

The average amount spent per customer per order. 

B

Blog

An online library of content relevant to your business in order to attract both traffic and links to your store.

C

CMS / Content Management System

 A back-end interface e.g. WordPress.

Conversion Rate

The percentage of visitors to your website or landing page that convert.

Cost Per Action / CPA

The advertiser pays for each specified action (a purchase, a form submission, and so on) linked to the advertisement.

Cost Per Click / CPC

The sum paid by an advertiser to search engines and other Internet publishers for a single click on their advertisement which directs one visitor to the advertiser's website.

Cost Per Mille (thousand) / CPM

Used in marketing as a benchmark to calculate the relative cost of an advertising campaign or an ad message in a given medium. Rather than an absolute cost, CPM estimates the cost per 1000 views of the ad.  can be purchased on the basis of what it costs to show the ad to one thousand viewers (CPM). 

Cost Per Sale / CPS

Revenue sharing on the internet is also known as cost per sale, and accounts for about 80% of affiliate compensation programs.

CRM / Customer Relationship Management

The method of finding, attracting, and winning new clients as well as nurturing and retaining those the company already has. Also includes enticing former clients back into the fold, and reducing the costs of marketing and client service.

CRO / Conversion Rate Optimisation

The "systematic process of increasing the percentage of visitors to your company site who take a desired action". 

CTA / Call To Action

The heading or phrase on your page which encourages the page visitor to take action  (i.e make a purchase or sign up for a newsletter). CTAs have a proven impact on conversion rates.

D

Dropshipping 

A type of ecommerce arrangement "where the manufacturer or distributor ships directly to your customers, often in generic packaging. This means you don’t hold stock, but expect to pay a greater cost per item sold."

Domain Name

Your web address.

E

Ecommerce 

The process of "selling products online and on mobile through shops, 3rd party marketplaces like Amazon and Ebay, and other channels".

F

Fulfilment

The process of "completing and delivering purchased products or services to the customer".

G

Google Analytics

A free tool you can link up with your website enabling you to track site performance and gain valuable insight.

Google Webmaster Tools

 "gives feedback about your website and your Google rankings, from Google, so you can tweak and optimise your website performance for better results".

I

Inventory

Inventory is the complete list of the actual stock a business holds. 

L

Long Tail

The term used to describe 'highly specific' keywords and search terms.

Landing Page

The page your customers will land on and which is designed to maximise conversion or take a particular action.
 

M

Margin

The profit percentage of a sale after the cost of goods and expenses have been taken into account - profitability

Multi-Channel Ecommerce

The process of selling goods and services across multiple channels and devices.

Multi-variate Testing / MVT

A process by which more than one component of a website may be tested in a live environment. It can be thought of in simple terms as numerous A/B tests performed on one page at the same time. A/B tests are usually performed to determine the better of two content variations, multivariate testing can theoretically test the effectiveness of limitless combinations.

O

Outsource

Utilising third party providers to "handle elements or functions of your business on your behalf".

P

PPC / Pay Per Click 

An Internet advertising model used on websites, where advertisers pay their host only when their ad is clicked. With search engines, advertisers typically bid on keyword phrases relevant to their target market. Content sites commonly charge a fixed price per click rather than use a bidding system.

Payment Gateway 

The "payment processor used to handle transactions on your ecommerce store" - can be on or off-site.

R

Return on Investment / ROI

S

SEO / Search Engine Optimisation 

The process of improving the visibility of a website or a web page in search engines (mainly Google) via the "natural" or un-paid, "organic" or "algorithmic", search results to give the best possible ranking within relevant SERPs.

Search Engine Marketing / SEM

A form of internet marketing that seeks to promote websites by increasing their visibility in search engine result pages (SERPs) through the use of search engine optimization, paid placement, contextual advertising, and paid inclusion.

SERP / Search Engine Results Page

The "page that is generated by searching for a given phrase on Google."

Social Signals  

"Social signals are a ranking factor in Google, drawn from social networks like Twitter, Facebook and Google Plus". They work in a similar way to backlinks.

Social Media 

"Websites and applications that enable users to create and share content or to participate in social networking" or business interaction.

Sites such as Facebook, Twitter, Instagram, Pinterest etc can help businesses "tap into targeted audiences through advertising, or through a comprehensive social media strategy".

Split Testing 

"Testing two separate elements of your ecommerce mix to establish which performs better".

T

Traffic  

The "level of visitors coming to your site from a number of sources".  It is "the ‘input’ side of the ecommerce equation". 

U

Usability 

The efficiency and ease with which your customers and website interact.  Essential for quality CX and is central to conversion rate.

"Usability now also extends to mobile and tablet devices, and the experience your ecommerce store offers across these channels".

W

WordPress

Is a free, open source blogging platform used as a basis for creating ecommerce stores and a series of other websites. "WordPress ties up with WooCommerce and others to provide ecommerce functionality through the WordPress platform".

WP Engine 

Classed as "the best hosting solution for those running ecommerce stores on WordPress".

WooCommerce

A  "customizable, open-source ecommerce platform built on WordPress". 


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With thanks to

Beringer Tame

Ecommerce Jargon Buster

Ecommerce Guide

Oxford Reference

Photo by Dmitry Ratushny on Unsplash

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